Fuel prices set to rise in Pakistan amid global rates, Middle East tensions

Fuel prices in Pakistan are expected to see an uptick for the next fortnight following a shift in the international market in rates of petrol and High-Speed Diesel (HSD). 

As per estimates, petrol prices are projected to be raised by Rs2.50 to Rs2.80 per litre, while HSD could jump by Rs8 to Rs8.50 per litre starting Monday, April 15.

Although, the recent escalation in the Middle East due to Iran’s Sunday attack on Israel is yet to materialise and it is expected that this will catalyse the global fuel market. 

This adjustment comes despite a drop in the import premium for petrol, which has decreased by 21% to $10.7 per barrel, and a slight appreciation of the Pakistani rupee against the dollar. 

The price of petrol is anticipated to rise from its current rate of Rs289.41 to about Rs292.21, reflecting the net impact of these factors.

On the international front, the cost of petrol and HSD has risen by approximately $4 and $4.50 per barrel respectively over the last two weeks. 

Despite this increase, the import premium for HSD remains steady at $6.50 per barrel, indicating a consistent cost pressure that leads to the estimated increase.

Amid commitments to the International Monetary Fund (IMF), the government aims to collect Rs869 billion as petroleum levy during the current fiscal year, having already secured about Rs475 billion in the first half. 

With these adjustments, the total tax charged on petrol and HSD stands at about Rs82 per litre.